I Was Wrong

Yesterday, we challenged the 10B/meeting meme. I lost. Although there is a heavy focus on "data dependent" (another idiot Fed term) and the quote is in answer to Ylan Mui's question, not Liesman's,,the fact remains Sudeep Reddy was right. The quote is posted below:

YLAN MUI. Thank you. Ylan Mui with the Washington Post. Today was the first reduction in asset purchases, and you just said that future reductions will likely occur in measured steps, but are not on a predetermined course. Can you tell us any more about the framework that you all plan to use to determine the size and the timing of those reductions? And previously you had said that you expect the program to end altogether by the middle of next year. Is that still a likely scenario?

CHAIRMAN BERNANKE. Well, as I said, the steps that we take will be data- dependent. If we’re making progress in terms of inflation and continued job gains—and I imagine we’ll continue to do, probably at each meeting, a measured reduction—that would take us to late in the year, certainly not by the middle of the year. If the economy slows for some reason or we are disappointed in the outcomes, we could skip a meeting or two. On the other side, if things really pick up, then of course we could go a bit faster, but my expectation is for similar moderate steps going forward throughout most of 2014.

Thus the Chairman exited by laying the groundwork for repeating the biggest mistake of the Greenspan Fed - Putting policy on a path and telling market participants in advance what will happen at 2pm et every 6 weeks. (Sad trombone) So to recap the message: There is no predetermined course of reduction, its data dependent but probably some at every meeting, which would wind down to zero by year end but not to mid-year and of course they could do more or less depending on the data. Oh, and the guy saying it doesn't work there anymore. I can't believe I got that wrong. Red pack bid please.